[Federal Register Volume 63, Number 136 (Thursday, July 16, 1998)]
[Proposed Rules]
[Pages 38347-38349]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-18913]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Docket No. FV98-905-3 PR]


Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; 
Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule would increase the assessment rate from $0.0035 to 
$0.00385 per 4/5 bushel carton established for the Citrus 
Administrative Committee (Committee) under Marketing Order No. 905 for 
the 1998-99 and subsequent fiscal periods. The Committee is responsible 
for local administration of the marketing order which regulates the 
handling of citrus grown in Florida. Authorization to assess citrus 
handlers enables the Committee to incur expenses that are reasonable 
and necessary to administer the program. The fiscal period begins 
August 1 and ends July 31. The assessment rate would remain in effect 
indefinitely unless modified, suspended, or terminated.

DATES: Comments must be received by August 17, 1998.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, Fruit 
and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, 
Washington, DC 20090-6456; Fax: (202) 205-6632. Comments should 
reference the docket number and the date and page number of this issue 
of the Federal Register and will be available for public inspection in 
the Office of the Docket Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Southeast Marketing 
Field Office, Fruit and Vegetable Programs, AMS, USDA, P.O. Box 2276, 
Winter Haven, FL 33883-2276; telephone: (941) 299-4770, Fax: (941) 299-
5169; or George Kelhart, Technical Advisor, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room 
2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202) 
720-2491, Fax: (202) 205-6632. Small businesses may request information 
on compliance with this regulation by contacting Jay Guerber, Marketing 
Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 
room 2525-S, P.O. Box 96456, Washington,

[[Page 38348]]

DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-6632.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 84 and Order No. 905, both as amended (7 CFR part 905), 
regulating the handling of Oranges, Grapefruit, Tangerines, and 
Tangelos grown in Florida, hereinafter referred to as the ``order.'' 
The marketing agreement and order are effective under the Agricultural 
Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), 
hereinafter referred to as the ``Act.''
    The Department of Agriculture (Department) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, Florida citrus 
handlers are subject to assessments. Funds to administer the order are 
derived from such assessments. It is intended that the assessment rate 
as issued herein will be applicable to all assessable citrus beginning 
on August 1, 1998, and continue until amended, suspended, or 
terminated. This rule will not preempt any State or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with the Secretary a 
petition stating that the order, any provision of the order, or any 
obligation imposed in connection with the order is not in accordance 
with law and request a modification of the order or to be exempted 
therefrom. Such handler is afforded the opportunity for a hearing on 
the petition. After the hearing the Secretary would rule on the 
petition. The Act provides that the district court of the United States 
in any district in which the handler is an inhabitant, or has his or 
her principal place of business, has jurisdiction to review the 
Secretary's ruling on the petition, provided an action is filed not 
later than 20 days after the date of the entry of the ruling.
    This rule would increase the assessment rate established for the 
Committee for the 1998-99 and subsequent fiscal periods from $0.0035 to 
$0.00385 per 4/5 bushel carton handled.
    The Florida citrus marketing order provides authority for the 
Committee, with the approval of the Department, to formulate an annual 
budget of expenses and collect assessments from handlers to administer 
the program. The members of the Committee are producers and handlers of 
Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida. They 
are familiar with the Committee's needs and with the costs for goods 
and services in their local area and are thus in a position to 
formulate an appropriate budget and assessment rate. The assessment 
rate is formulated and discussed in a public meeting. Thus, all 
directly affected persons have an opportunity to participate and 
provide input.
    For the 1996-97 and subsequent fiscal periods, the Committee 
recommended, and the Department approved, an assessment rate that would 
continue in effect from fiscal period to fiscal period unless modified, 
suspended, or terminated by the Secretary upon recommendation and 
information submitted by the Committee or other information available 
to the Secretary.
    The Committee met on May 22, 1998, and unanimously recommended 
1998-99 expenditures of $242,275 and an assessment rate of $0.00385 per 
\4/5\ bushel carton of citrus. In comparison, last year's budgeted 
expenditures were $242,000. The assessment rate of $0.00385 is $0.00035 
higher than the rate currently in effect. Shipments of fresh citrus for 
the 1997-98 season are expected to be less than the Committee's initial 
estimate of 65,000,000 cartons. Estimated shipments for 1998-99 are 
61,500,000 cartons, or 3,500,000 million cartons less than the 1997-98 
estimate. Due to the reduced fresh shipments of Florida citrus to 
interstate and export markets, the Committee voted to increase the 
assessment rate to generate funds necessary to meet Committee operating 
expenditures, and maintain an adequate operating reserve.
    The major expenditures recommended by the Committee for the 1998-99 
year include $115,800 for salaries, $36,000 for Manifest Department-
FDACS, $18,400 for insurance and bonds, and $12,325 for retirement 
plan. Budgeted expenses for these items in 1997-98 were $105,300, 
$36,000, $16,500, and $11,200, respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of Florida citrus. 
As mentioned earlier, citrus shipments for 1998-99 are estimated at 
61,500,000 cartons which should provide $236,775 in assessment income. 
Income derived from handler assessments, along with interest income and 
funds from the Committee's authorized reserve, would be adequate to 
cover budgeted expenses. Funds in the reserve (currently $109,371) 
would be kept within the maximum permitted by the order (approximately 
one-half of one fiscal period's expenses; Sec. 905.42).
    The proposed assessment rate would continue in effect indefinitely 
unless modified, suspended, or terminated by the Secretary upon 
recommendation and information submitted by the Committee or other 
available information.
    Although this assessment rate would be in effect for an indefinite 
period, the Committee would continue to meet prior to or during each 
fiscal period to recommend a budget of expenses and consider 
recommendations for modification of the assessment rate. The dates and 
times of Committee meetings are available from the Committee or the 
Department. Committee meetings are open to the public and interested 
persons may express their views at these meetings. The Department would 
evaluate Committee recommendations and other available information to 
determine whether modification of the assessment rate is needed. 
Further rulemaking would be undertaken as necessary. The Committee's 
1998-99 budget and those for subsequent fiscal periods would be 
reviewed and, as appropriate, approved by the Department.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this rule on small entities. Accordingly, AMS has 
prepared this initial regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.
    There are approximately 11,000 producers of citrus in the 
production area and approximately 109 handlers subject to regulation 
under the marketing order. Small agricultural producers have been 
defined by the Small Business Administration (13 CFR 121.601) as those 
having annual receipts less than $500,000, and small agricultural 
service firms are defined as those whose annual receipts are less than 
$5,000,000. The majority of Florida citrus producers and handlers may 
be classified as small entities.
    This rule would increase the assessment rate established for the 
Committee and collected from handlers

[[Page 38349]]

for the 1998-99 and subsequent fiscal periods from $0.0035 per \4/5\ 
bushel carton to $0.00385 per \4/5\ bushel carton handled. The 
Committee unanimously recommended 1998-99 expenditures of $242,275 and 
an assessment rate of $0.00385 per \4/5\ bushel carton. The proposed 
assessment rate of $0.00385 per \4/5\ bushel carton is $0.00035 higher 
than the 1997-98 rate. The quantity of assessable citrus for the 1998-
99 season is estimated at 61,500,000. Thus, the $0.00385 rate should 
provide $236,775 in assessment income. Income derived from handler 
assessments, along with interest income and funds from the Committee's 
authorized reserve, would be adequate to meet this year's expenses.
    The Committee estimates a reduced amount of fresh shipments of 
Florida citrus for the 1998-99 season. They unanimously recommended 
1998-99 expenditures of $242,275 which included increases in staff 
salaries and benefits, and equipment rental. Due to the anticipated 
reduction of fresh shipments, the Committee voted to increase the 
assessment rate to generate the funds necessary to meet the Committee's 
operating expenses and maintain an adequate operating reserve. The 
Committee's authorized reserve (approximately one-half of one fiscal 
period's expenses) is currently $109,371. The revenue from assessments, 
along with interest income and funds from the Committee's authorized 
reserve, would be adequate to cover budgeted expenses.
    The Committee reviewed and unanimously recommended 1998-99 
expenditures of $242,275 which included increases in staff salaries and 
benefits, and equipment rental. Prior to arriving at this budget, the 
Committee considered information from various sources, such as the 
Committee's Budget Sub-Committee. Alternative expenditure levels were 
discussed. However, it was determined that the increases in salaries, 
benefits, and equipment were needed and justified. The assessment rate 
of $0.00385 per \4/5\ bushel carton of assessable Florida citrus was 
then determined by dividing the total recommended budget by the 
quantity of assessable citrus, estimated at 61,500,000 \4/5\ bushel 
cartons for the 1998-99 fiscal period. This is approximately $5,500 
below the anticipated expenses. Assessment income, along with interest 
income and funds from the Committee's authorized reserve, would be 
adequate to cover budgeted expenses, which the Committee determined to 
be acceptable.
    There are several varieties of citrus regulated under the order. In 
the 1997-98 season, the f.o.b. price ranged from around $5.83 to $6.71 
for oranges, from around $5.26 to $6.31 for grapefruit, and from around 
$7.17 to $20.39 for speciality citrus. Depending on the volume and 
variety produced by the individual grower, the price for Florida citrus 
during the 1998-99 season is expected to range between $5.26 and $20.39 
per \4/5\ bushel carton. Therefore, the estimated assessment revenue 
for the 1998-99 fiscal period as a percentage of total grower revenue 
could range between 0.02 and 0.07 percent.
    This action would increase the assessment obligation imposed on 
handlers. While assessments impose some additional costs on handlers, 
the costs are minimal and uniform on all handlers. Some of the 
additional costs may be passed on to producers. However, these costs 
would be offset by the benefits derived by the operation of the 
marketing order. In addition, the Committee's meeting was widely 
publicized throughout the Florida citrus industry and all interested 
persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the May 22, 
1998, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue. Finally, interested 
persons are invited to submit information on the regulatory and 
informational impacts of this action on small businesses.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large Florida citrus 
handlers. As with all Federal marketing order programs, reports and 
forms are periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies.
    The Department has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this rule.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because: (1) The Committee needs to have sufficient funds to pay its 
expenses which are incurred on a continuous basis; (2) the 1998-99 
fiscal period begins on August 1, 1998, and the marketing order 
requires that the rate of assessment for each fiscal period apply to 
all assessable citrus handled during such fiscal period; and (3) 
handlers are aware of this action which was unanimously recommended by 
the Committee at a public meeting and is similar to other assessment 
rate actions issued in past years.

List of Subjects in 7 CFR Part 905

    Grapefruit, Marketing agreements, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 905 is 
proposed to be amended as follows:

PART 905--ORANGES, GRAPEFRUIT, TANGERINES, AND TANGELOS GROWN IN 
FLORIDA

    1. The authority citation for 7 CFR part 905 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.

    2. Section 905.235 is proposed to be revised to read as follows:


Sec. 905.235  Assessment rate.

    On and after August 1, 1998, an assessment rate of $0.00385 per 4/5 
bushel carton is established for assessable Florida citrus covered 
under the order.

    Dated: July 10, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-18913 Filed 7-15-98; 8:45 am]
BILLING CODE 3410-02-P